Thursday, March 15, 2012

You Can't Unpoor the Poor. But You Can the Middle Class...

For ye have the poor with you always, and whensoever ye will ye may do them good: but me ye have not always Mark 14:7

In a recent posting - or several - I pointed out that poverty is really a state of mind - the Culture of Poverty. If you think poor, act poor, make poor choices, make poor decisions, and do poor things, you will end up poor and stay poor, perhaps for generations. It is a vicious cycle.

And I have noted time and again how our institutions victimize the poor - offering them the worst sort of bargains on the grounds that they are "credit risks" - so they end up paying more than everyone else for basic necessities.

And I pointed out that there are poor people who are basically very decent people who are just not very bright and will never earn enough money. And unless they marshal their resources very carefully, they will be exploited mercilessly.

And no one deserves that. And the funny thing is, though, if you try to "help the poor" they often will resist your best efforts. The owner of the "Payday Loan" joint isn't going to shout you down when you point out he is basically a crook. No, no, it will be his customers who will defend him - to their last breath. They view the finance company as their friend - a place where they have power and control. And if you try to "take that away" from them, they get upset.

But that doesn't make it a good bargain, and any middle-class person would snort in derision at the thought of using pawn shops, check-cashing stores, payday loans, buy-here-pay-here used car dealers, or any one of the number of rip-offs the poor get fucked by.

As a middle-class person, you'd laugh at the thought of it.

And perhaps, as it says in Mark, the poor will always be with us. And we can help them. But there will always be the poor. So you can declare "war on poverty" - but you will never win it. Because no matter how hard you try, there will always be one person who makes bad choices and defends them to the death (like the guy who gets a tattoo) as being rational, reasonable choices, and not only that, smart.

But, I did not start this blog to help the poor. As far as I can tell, they are beyond help. They take the worst sort of deals, believe in the most odious of politics and religions, follow whatever trend that comes into town, no matter how stupid, and generally are just unpleasant people to deal with. These are the people who join the KKK or the Crips. People who would likely kill you, if they had a chance. And not surprisingly, they populate the nation's prisons. There are no smart poor. There are no intellectual poor. There are very few sane poor. They are poor not by accident, but by design - and by actions. I wish I could help, but I can't.

But the middle-class? They are smart enough to know better, but often aren't. Intelligent, middle-class people get distracted by the media and pretty soon sink to the level of poverty-think. Television, blasting poor normative cues (and aided by all the other media) soak the mind with bad ideas and present bad bargains.

And pretty soon, the middle class is doing their own version of poverty-think. Doing drugs. Buying things on time. Refinancing their homes to pay off high-interest airline miles credit cards. Clipping coupons and getting rebates - convinced they can spend their way to wealth. And where do they get these ideas? From the TeeVee, of course.

The other day, I was on a FICO discussion group that linked to one of my pages about Simmons First Credit cards. I have one, it has a 7.15% interest rate. I have a Capital One with a 6.5% interest rate. What was interesting about the discussion was that the people on the site - obsessed about their credit scores and getting the "best deal" on a credit card, dismissed the Simmons First card, because only people with really great credit and "high incomes" can get them. Another complained that there were no "bonus cash-back" gimmicks with the card

Really? I got one. I don't make a lot of money.

The discussion was depressing, as it was akin to a bunch of poor people comparing notes on which PayDay loan joint was the best bargain - when in fact, none of them are. But they are convinced that the path to riches lies in debt and credit cards and credit score. That if only you can play this debt game the banks have created, you can end up "winning" in the end.

You can't. You can't borrow wealth. You can't borrow your way to wealth.

Rich people know this - and they are the one's whose money you are borrowing. They make lots of dough off the poor, and today they make even more off the middle class.

The poor, we can't help. They are not very bright and are not going to wake up one morning and say, "Gee, maybe if I didn't commute to work in a giant 10 mpg pickup truck, spend every last penny on beer, drugs, and tattoos, and drive like a maniac and pay top dollar for car insurance, I might actually get ahead in the game!" No, they never will do that - ever, ever. They are convinced they are right, so they will fly a giant American flag from the back of their truck and say it is Obama's fault that gas and cigarettes cost so much and then vote for a guy who supervised the dismantling of their place of work and laid them off and destroyed their parent's pension plan. The poor are just that dumb, I'm afraid. You can't fix stupid.

But, Mr. and Mrs. Middle Class? What's your freaking excuse?

Really. What is it? You say you are living "paycheck to paycheck" and it has to be someone Else's fault. Really? Do you really believe that, or are you smarter than that?

There is a lot of talk today about the 1% versus the 99% and how the disparity between rich and poor is increasing. And there is a lot of talk about the "lost middle class" and how the middle class has been beaten down and losing ground.

And you pull into the driveway of any middle-class home and they have four cars - all parked outside, and a satellite dish (or two or three) and smart phones and delivery pizza, and a pair of abandoned jet skii parked in the side yard, and.... well you get the picture.

Our middle class is losing its standard of living because it is increasing its standard of living. We have no money in the bank and nothing in our 401(k), but each person in the house has their own TeeVee and cell phone and computer.

And these middle-class people - smart middle-class people who went to college - just don't get it. They don't understand why they are living "paycheck to paycheck" and underfunding their own retirement. It can't be the maid that comes in once a week, right? Because everyone on the block has one - and a yard service, right?

They are blind, but cannot see.

To create wealth - to become middle class and stay that way you have to accumulate wealth. And my parent's generation did this, and how they did it was by not having a lot of crap in their home. No gourmet kitchens, no "glamor baths" - no granite counter-tops, no separate baths for each child. One television, and no cell phones.

Were we poor? In Old Greenwich, Connecticut? Hardly. But today, people would turn their nose up at such a lifestyle, and then go broke trying to live the modern one. And we are not talking about $20 here aad $50 there - but thousands and thousands of dollars a MONTH, which cumulatively comes to tens of thousands of dollars a year - which can be a hundreds of thousands over a decades - millions in retirement.

But we don't see it. Just as the poor person who pays $25 to cash his $250 paycheck doesn't see that he is being gouged, we in the middle-class pay for all this "stuff" in our lives and don't see that it is bringing us down to a level of poverty.

The poor will always be with us. But the middle class will not be. Why? Because they are slowly sliding down the scale to poverty, and doing it one credit card swipe at a time.

And no, this isn't the fault of the Wall-Street Fat Cats or the one-percenters. We are willingly handing other people our wealth and then wondering where it all went.

That's where the money went. We gave it away for beads and trinkets, cable TV and a smart phone.